| Who pays? | mainly companies holding UK residential property worth over £500,000 |
| Charge 2026/27 | £4,600 to £303,450 a year, depending on value |
| From 1 April 2027 | plus 3.5 percent (inflation) |
| Valuation date | 1 April 2022 or a later purchase date |
| Deadline | return and payment by 30 April |
| Relief | e.g. for letting to unconnected tenants, but only with a relief declaration return |
| Updated | November 2026 |
Who pays the Annual Tax on Enveloped Dwellings
ATED is an annual tax paid mainly by companies that own a UK residential property worth more than £500,000, wholly or partly. Partnerships with a company as a partner and collective investment vehicles such as unit trusts are caught too. Whether the company is based in the UK or abroad makes no difference.
A dwelling is anything used or suitable for use as a home, including garden, grounds and outbuildings. Hotels, guest houses, care homes and student halls do not count.
ATED rarely comes alone. If a company buys a residential property over £500,000, stamp duty is charged at 17 percent of the whole price, 19 percent for buyers from abroad. A foreign company must also register beforehand on the register of overseas entities at Companies House. More on buying in buying a house in England.
ATED 2026/27 and 2027/28: the annual charges
The charge depends on the property's value at the valuation date. It rises with inflation every year; by 3.5 percent on 1 April 2027.
| Property value | 1.4.2026 to 31.3.2027 | 1.4.2027 to 31.3.2028 |
|---|---|---|
| over £500,000 to £1 million | £4,600 | £4,750 |
| over £1 million to £2 million | £9,450 | £9,750 |
| over £2 million to £5 million | £32,200 | £33,300 |
| over £5 million to £10 million | £75,450 | £78,050 |
| over £10 million to £20 million | £151,450 | £156,750 |
| over £20 million | £303,450 | £314,050 |
HMRC, ATED the basics; HM Treasury, Budget 2026 Annex A
Valuation: which value counts
Properties are revalued every five years. For the years from 2023/24 the value on 1 April 2022 applies. If the company bought later, the value at the purchase date counts. According to HMRC's table, that valuation date applies up to and including 2027/28.
If the value is close to a band boundary, you can ask HMRC for a pre-return banding check before filing. It is worth it: between £1 million and £2 million lie two bands with more than double the tax.
Reliefs: paying nothing, but still filing
Many companies end up paying no ATED because a relief applies. The most important for our readers: the property is let commercially to unconnected tenants and at no point occupied by, or even available to, anyone connected with the owner. If the shareholder lives there even briefly, or it is available to them, the condition fails.
Other reliefs include properties open to the public for at least 28 days a year, developers building for sale, property traders' stock, homes for employees of a trading business, and farmhouses occupied by farm workers.
Important: relief does not come by itself. If it reduces the tax to nil, you file a relief declaration return through the ATED online service. Forget it and you risk penalties even though no tax would be due. Only genuine exemptions, such as charitable companies or public bodies, file nothing at all.
Deadlines: 30 April
The ATED year runs from 1 April to 31 March. You file and pay at the start of the year, not the end.
- 1
Held on 1 April
If the property is within scope on 1 April, the return and payment go to HMRC by 30 April. Each property with tax due needs its own return.
- 2
Bought during the year
If the company buys later in the year, it has 30 days from acquisition to file. Payment is due the same day.
- 3
New build
For a new build there is a 90-day deadline, for example from the day the house is treated as a dwelling for council tax or first occupied.
- 4
Late
File or pay late and you pay penalties and interest.
Is the company still worth it for the property?
For a home you use yourself, the answer is almost always no: 17 or 19 percent stamp duty on purchase, ATED every year and corporation tax on the gain when you sell. It can look different if the company lets commercially and uses reliefs, or if the property is part of a business; see buying property through a company. If you are planning a UK holding, read UK holding company for the corporate side; for residential property the rules on this page always apply on top.
If a foreign company sells the property, it pays UK corporation tax on the gain. How it works for individuals is in selling UK property.
Frequently asked questions about ATED
Do I pay ATED if I own the flat personally?
No. ATED is paid by companies, partnerships with a company as partner and certain investment vehicles, not by individuals.
How much ATED do I pay in 2026/27?
Between £4,600 (value over £500,000 to £1 million) and £303,450 (over £20 million). From 1 April 2027 the charges rise by 3.5 percent.
Do I have to file if the flat is let?
Yes. The relief for letting to unconnected tenants must be claimed every year with a relief declaration return, by 30 April.
Does ATED apply to property in Scotland and Wales?
Yes. ATED covers residential property throughout the UK.
Sources: HMRC: Annual Tax on Enveloped Dwellings, the basics; HMRC: ATED reliefs and exemptions; HMRC: ATED returns; HMRC: Pay Annual Tax on Enveloped Dwellings; HMRC: ATED, work out the value of your property; HM Treasury: Budget 2026, Annex A rates and allowances; HMRC: Stamp Duty Land Tax, corporate bodies; Companies House: Register an overseas entity
